Ninety percent (90%) of the car dealers we talk to over the phone, at trade shows, and in one-on-one meetings, have zero processes in place to buy or sell cars from the service drive. That means only 10% of car dealers are taking advantage and selling cars to those who should be in the market for a new car and are in the dealership right now.
And, those that are taking action and trying to sell from the service drive are achieving sales of only 0.5 percent of RO’s compared to our clients who are achieving 4% to 5% with a customer-focused approach. In fact, after the third month of implementation, Bulldog Kia – Bogart, GA had a 4.68% closing rate from the service drive. They had 427 RO’s and 20 sales in a 30 day period.
Now, I know many of you who are reading this blog post right now are still skeptical as you put sales and service in two completely different silos. And, as you’ve either never thought about your service drive as a vehicle to sell more cars or tried it and failed, let me share four service drive selling undisputed facts that only 10% of today’s car dealerships are taking advantage of.
Service Drive Selling Undisputed Fact #1: It’s the greatest, most cost-effective opportunity within your dealership right now to increase sales immediately and permanently
Dealerships are spending at least $400 per car sold on advertising – whether it’s direct mail, email campaigns and newspaper/TV/radio/magazine ads or 3rd party leads – to bring more people into their dealerships. Many dealerships are paying even more money for advertising as they are implementing social media marketing and mobile marketing campaigns on top of all their other marketing efforts. We know this because we manage client’s marketing campaigns through our Auto Point Division.
Yet, car dealerships with a service drive have customers coming in every day who:
- Have manufacturer’s warranties expiring and will want to experience maintenance savings
- Are paying interest rates that are too high
- Have equity in the car that can be used as a down payment on a new vehicle
You don’t have to worry about getting these people into the door – and spending extra money. They’re already in your dealership. They just need a customer service representative to review their needs and let them know about their options.
Service Drive Selling Undisputed Fact #2: It’s the most effective way to prevent your competition from stealing your customers
If you don’t have a service drive conversion process in place, you have no way to tell whether or not the service drive customers (that are already inside your dealership) are or should be in the market for a new car.
So your customers are leaving the store and they’re exposed to advertising from your competitors constantly. Now, as the customers are already in your store, if you took the opportunity to reach out and speak to them about their needs you can capture people in the market before your competitors.
Service Drive Selling Undisputed Fact #3: If done correctly there is no better way to increase both your customer service and service satisfaction indexes
Many car dealers are afraid to try to sell cars from their service drive as they’ve tried to place a traditional salesman in the service department and it failed miserably. Instead of selling more cars, customers became turned off with their service experience. It’s because they approached selling cars from the service drive the same way they would in the showroom.
Instead, you have to make it about improving the customer experience. You want it to be about quality assurance – where you are making sure that their service needs are met. And, while you review their needs (and their information), you let them know about their options and how they can save money in the long run. Our clients are not only experiencing 20-25 more cars sold per month out of their service drive, but they are also experiencing increases in both their CSI and SSI.
As a Quality Assurance Representative at one of our customers in Canada told us recently; “Exclusively selling cars out of service was new for me. I am a closer and have always worked the front. I had to actually “calm myself down” and not “go in for the close” as fast as I normally would. These customers came in for Service, not to buy a car. Once I really focused on this I saw results.”
Service Drive Selling Undisputed Fact #4: Data mining tools miss 70% of the car selling opportunities from the service drive.
There are several data mining tools available in the market today. But that’s all they are – a tool. They don’t have any answers for the traditional selling approach. Plus, data mining tools can’t help car dealerships with customers that come in without an appointment.
That means dealerships miss out on 60-70% of the opportunities, as that is the typical percentage of people that come in for service without an appointment. You need a service drive selling process that allows your dealership to put customers through the sales process whether they have a scheduled appointment or not. Data mining is just a very small part of that overall process.
Interested in learning how you can sell more cars from the service drive?
Join us for a free webinar, where we’ll talk about industry trends and show you why now is the time to really focus on sales through the service drive. We’ll also share an example of a customer that has been converting 4-5% of their RO’s into new car sales for months.
Register for this free webinar now: Click HERE to register!
I always feel very fortunate to participate in the Digital Dealer Conferences. Helping dealers and their management staff gain new insights and techniques to increase revenue is something that’s very rewarding.
On Tuesday, I was happy to be one of the first speakers at the three day conference. I presented to a full room on the strategies service management can use to transform their service drive into a sales drive. I spoke about using mobile technology and taking a new approach to customer retention with new vehicle acquisitions in the service drive — We’re leaving money on the table, folks!
In today’s automotive world, no dealer wants to lose business and the service drive is filled with potential sales opportunity. And I’m not just talking about up-sells on ROs. The audience was very receptive and inquisitive to the ideas I shared concerning increasing revenue and analyzing fixed operations to identify areas which can be improved. With so many quality speakers and sessions to choose from, I am grateful so many dealers chose to hear what I had to say. It’s always rewarding to have an intimate discussion with dozens of individuals at one time about how we can move our industry forward and think outside-the-box.
On the exhibit hall floor, our staff showcased MPi’s newest accelerator, EDGE SmartTech. Our team was inundated with dealerships interested in learning how our unique data can help technicians perform vehicle inspections at a higher caliber and present legitimate vehicle recommendations. It certainly proves that dealers are starting to recognize the revenue they are failing to take advantage of that’s presenting itself to them daily.
To the conference staff and all of the attendees of the 14th Digital Dealer Conference & Exposition, thank you for another great conference and for the privilege of assisting dealers.
Transforming your Service Drive into a Sales Drive
In this presentation Holland will address how to empower the service department with tools that build connections with customers and drive owner retention. Although the obstacles can appear formidable, your service department can flourish in today’s rapidly changing automotive landscape. How auto dealer service departments will remain profitable and viable contributors to the business with fewer units in operation, longer maintenance intervals, and higher vehicle quality is a challenge. The subsequent reduction in vehicle volumes means that every visit, no matter how small, needs to be viewed as a vital opportunity. Many service directors are leveraging technology to be more efficient and profitable.
Technology in the service lane helps dealerships:
- Turn service customers into new vehicle sales customers
- Inspect every vehicle thoroughly to boost per-repair-order parts and labor profitability
- Hone customer-engagement processes to improve customer retention
- Conquest the service business from customers’ families and friends
New technologies in the service department have helped dealerships:
- Increase annual service revenues 21% and more
- Boost revenue per repair order $55 and higher
- Double the volume of vehicles inspected
- Increase fixed absorption rates 20%and more
- Sell up to 6 times as many vehicles out of their service drive
The ideas Holland will share are to help your service department create a plan for profitability despite today’s challenges in automotive services and repairs.
Attendees will learn five key actionable points:
1) How to develop a client retention strategy that builds trust between the dealership and the customer
2) How to develop processes that turn service customers into new vehicle sales customers
3) How to create follow up marketing strategies that engage customers who’ve declined recommendations
4) How to create a personalized service experience utilizing mobile technology
5) How to identify new opportunities and metrics to use to identify and remedy inefficiencies in service work flow.